Tore Jacobsen, chair of the Fraser Valley Real Estate Board (FVREB) and managing broker with McDonald Realty, has shared initial reactions to the new provincial budget, expressing concerns that certain tax additions and increases could drive up real estate prices.
Key Takeaways
- The FVREB is still conducting a thorough analysis of the provincial budget.
- Initial concerns focus on the addition of PST to real estate-related services.
- The board plans to present budget-related concerns to the government during annual liaison days.
- Jacobsen emphasizes the need for a "fulsome analysis" before making definitive statements.
Initial Budget Concerns
Jacobsen indicated that the FVREB is in the process of thoroughly reviewing the provincial budget. However, he noted that the introduction of the Provincial Sales Tax (PST) on various real estate-related services, such as architecture and other professional services, is a point of concern. "On the surface, our initial reaction is that additions of PST for those various services... it just is going to have an impact," Jacobsen stated, adding that the exact degree of this impact is yet to be determined as they continue to "digest" the budget details.
Impact on Housing Projects
The FVREB plans to formally present any budget-related concerns to the provincial government during their annual government liaison days in Victoria. Jacobsen highlighted that these discussions will be framed within the context of the current real estate and housing market. He pointed out existing challenges, including housing projects being put on hold or not initiated at all, and expressed uncertainty about how the new budget might exacerbate these issues.
Call for Thorough Analysis
While acknowledging the widespread concern regarding the budget and its potential effects on residents, Jacobsen urged a measured approach. He stressed the importance of conducting a "fulsome analysis" of the budget before issuing major statements. Jacobsen cautioned against a reactive approach, referencing past instances where initial decisions led to unforeseen collateral consequences, necessitating reversals. The FVREB intends to take its time to understand the budget's intricacies, identify what works, and then educate the public on the rationale behind specific decisions.
